Wired business conference paper Disruptive by design

JUNE 15, 2009 / NEW YORK CITY

WIREd dIgITal WhITE PaPER / JUNE 25, 2009

Presented by

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dIsrUPtIVe BY dESIgN /

/ TaBlE OF CONTENTS

2 / INTRODUCTION

3 / FRee: The FUTURe OF a RaDICal PRICe CHRIS ANDERSON editor in Chief, WIReD Magazine

4 / COllabORaTION as a bUsINess MODel TIM CADOGAN CeO, OpenX MARK SHUTTLEWORTH Founder, Ubuntu Project

5 / bReakINg The PRICe baRRIeR ELON MUSK Founder, Tesla Motors; spaceX

6 / IT’s NOT abOUT The CaR SHAI AGASSI Founder & CeO, better Place

7 / aND DaTa FOR all VIVEK KUNDRA Federal CIO, Usa

8 / The leasT lIkely FINaNCIal gIaNT SCOTT THOMPSON President, PayPal

9 / havINg CONFIDeNCe ON The eDge JEFF BEZOS Founder & CeO, amazon.com

10 / DIsRUPT beFORe yOU’Re DIsRUPTeD JEFF IMMELT Chairman & CeO, ge

11 / WhO NeeDs MOODy’s? JESPER ANDERSEN & TOBY SEGARAN Co-Founders, Freerisk

12 / The gaMe has JUsT ChaNgeD NEIL YOUNG Founder & CeO, ngmoco

13 / ReCaP: a Day OF DIsRUPTIve DIsCUssION

18 / sPONsORs

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We live in an era of relentless change. New technologies and business

models emerge almost overnight. advertising, retail, manufacturing, media,

financial services, travel—no matter what business you’re in, you’ve felt,

or are about to feel, the shockwave that disruption brings.

at WIREd we believe this flood of innovation represents a huge opportunity

—a once-in-a-lifetime chance to transform a company and a career.

disruptive By design was our effort to capture this concept for a select

like-minded audience.

In the pages that follow you’ll find summaries of all the conference events.

Each of our panelists told a different story of how to deal with change.

Jeff Immelt discussed shutting down gE’s incandescent bulb business

because it was good for his bottom line—and good for the planet. Federal CIO

Vivek Kundra laid out his ideas for government transparency via the new

website data.gov. and Neil Young of mobile game maker ngmoko shared how he

discovered a path to growth in the iTunes app Store. There were more insights

from Jeff Bezos, Shai agassi, Elon Musk, WIREd editor Chris anderson and

others. The clear message: If change is good, more change is better.

Whether you were at the Morgan library for the conference or you’re just

catching up now, we hope the ideas from disruptive By design will leave

you feeling better prepared to adapt, respond, and thrive—no matter what

comes at you next.

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/ ChRIS aNdERSON is editor in chief of WIREd magazine, a position he took in 2001, and has led the magazine to nine National Magazine award nominations, winning the prestigious top prize for general excellence in 2005, 2007 and 2009. he is the author of the New York Times best-seller The Long Tail, and runs a blog on the subject at www.longtail.com. anderson will publish his next book, FREE: The Future of a Radical Price, in July 2009. he is also founder of Booktour.com, a free online service that connects authors on tour with potential audiences. Previously he was at The Economist, where he served as U.S. business editor, asia business editor and technology editor. anderson’s media career began at the two premier science journals, Nature and Science. anderson holds a Bachelor of Science degree in Physics from george Washington University and studied Quantum Mechanics and Science Journalism at the University of California at Berkeley.

ChRIS aNdERSONEditor in Chief, WIREd Magazine

/ FREE: The Future of a Radical Price

ant an idea that will shake things up? What about free as

the ultimate price point? WIREd Editor in Chief Chris anderson has spent the last two years thinking about the idea of free. he says that zero is rapidly becoming the going rate for new competitors entering markets and even for established companies hoping to extend themselves.

“We have never had an industrial economy where things got 50 percent cheaper every year,” says anderson. Nowhere is this more true than on the Internet, where nonexistent barriers to entry and infinitesimal marginal

costs make free the new real price. “It’s the law of gravity, but online,” says anderson. “Everything digital will have a free counterpart. In some ways, the competition is to get to free before your opponent does.”

how to decide if a business could benefit from free? anderson says that companies may want to make their most popular product available for free, and then charge for specialized services, products or content. an example: wsj.com, the online services of the Wall Street Journal. The company offers dozens of news stories and blogs for free every day. Readers who want more pay $100 a year for

a full subscription, which gives them access to deep business news and specialized financial tools.

Microsoft is another example of smart use of the free model, says anderson. The company protested quietly but took little legal action while its Windows operating system was widely pirated in China. Microsoft executives were betting that each pirated copy of the operating system would help build a base of customers who would pay for the convenience of Windows support when they could afford to. “looking the other way,” says anderson, “Microsoft let pirates

be their best marketers, so that some day that piracy would come back as revenues.” anderson says that the Microsoft example perfectly illustrates two major types of customers in the world of free. One group is price sensitive, and looks for the lowest cost no matter what. The other is risk sensitive, willing to pay—sometimes a lot—for support, reliability, and timeliness.

and how does anderson incorporate free into his own life? his new book, FREE: The Future of a Radical Price, out in July, will be available in audiobook and e-book versions for—you guessed it—free.

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/ ClICk heRe FOR COMPleTe vIDeO COveRage wired.com/wiredbizprogram/videolibrary.html

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“In some ways, the comPetItIon Is to get to free before yoUr

oPPonent does.”

http://www.wired.com/wiredbizprogram/videolibrary.html

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/ Collaboration as a Business Model

t’s the ultimate business challenge: Can you make money going up

against Microsoft and apple, google and Yahoo, armed only with software and services that are free and open for anyone to adapt? “When you start with zero revenues,” says Tim Cadogan, CEO of ad publisher OpenX, “you have nothing to lose.”

That’s the basic story of open source software. Companies like OpenX and Ubuntu have repeatedly found ways to turn the weaknesses of their larger competitors into opportunities. Says Ubuntu founder Mark Shuttleworth, “It’s no surprise that smaller organizations

are willing to break the rules. The disadvantage to being the incumbent, to being the 800-pound gorilla, is that you’ve come to depend on things being true. They may have been true when you were founded, but might not be true today. Someone can come along and operate without those constraints.”

as an example, Shuttleworth cites the rise of netbooks, small, inexpensive computers designed primarily for running Internet applications. as competition drives down prices for the machines, open-source

software becomes more attractive to manufacturers like dell and hP, who license proprietary versions of Ubuntu. Even at cut-rate prices, other operating systems can’t compete. Shuttleworth estimates that Ubuntu now has between 10 and 15 million users, just behind the Mac OS.

Cadogan’s company works on a “freemium” model: OpenX provides ad publishers with free, flexible core software applications that users can build and tweak to reach their company’s target audience. Websites can use the free version of OpenX to serve up to 100 million ads per month.

More than that, and they pay. OpenX sees as many as 300 billion ads a month flow through its servers.

Both Cadogan and Shuttleworth say their mix of business is changing, with some new clients asking for services as well as software. That’s where the constant innovation of open source really starts to pay dividends: Their collaborators come up with more good ideas than any one individual or company ever could. “People are inventing things daily,” says Shuttleworth. “You encourage them to explore, and you can cherry pick what works.”

/ TIM CadOgaN is the chief executive officer of OpenX. OpenX’s purpose is to help businesses worldwide grow by providing compelling, open online advertising prod-ucts and services that drive revenues. Today, OpenX’s primary product is the world’s leading independent ad server, which is used by more than 35,000 publishers on more than 150,000 websites across the Internet. From 2003 to 2008 Tim was at Yahoo!, most recently as Senior Vice President of global advertising Market-places overseeing the primary advertising product lines at the company—including display, Search and Video. Previously at Yahoo!, Tim was Vice President of Search where he was responsible for both the consumer search and paid search businesses. Prior to Yahoo!, Tim was Vice President of Search at Overture (formerly goTo.com). at Overture, Tim played several roles, including driving product development and evangelizing the paid search model to the global search and portal industry.

TIM CadOgaNCEO, OpenX

/ MaRK ShUTTlEWORTh is founder of the Ubuntu Project, an enterprise linux distribution that is freely available worldwide and has both cutting-edge desktop and enterprise server editions. Mark studied finance and information technology at the University of Cape Town, and went on to found Thawte, a company specializing in digital certificates and cryptography. he sold Thawte to U.S. company VeriSign in 1999, and founded hBd Venture Capital and The Shuttleworth Foundation. he moved to london in 2001, and began preparing for the First african in Space mission, training in Star City, Russia, and Kazakhstan. In april 2002 Mark flew in space, as a cosmonaut member of the crew of Soyuz mission TM34 to the International Space Station. In early 2004 he founded the Ubuntu Project, which aims to produce a free, high-quality desktop OS for everybody.

MaRKShUTTlEWORThFounder, Ubuntu Project


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“PeoPLe are InVentIng thIngs daILy, yoU encoUrage them to

eXPLore, and yoUcan cherry PIcK what worKs.”


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/ ElON MUSK is the chairman, CEO and Product architect of Tesla Motors, where he has overseen product development and design from the beginning, including the all-electric Tesla Roadster and Model S sedan. Electric vehicles have been one of his central interests for almost two decades, stemming from his time as a physics student working on energy storage technologies. Elon’s other primary activity is serving as CEO and CTO of Space Exploration Technologies (SpaceX), which develops rockets and spacecraft for missions to Earth orbit and beyond. In 2006, SpaceX won the NaSa contract to design, build and demonstrate operation of a commercial replacement for the Space Shuttle, which retires in 2010. The SpaceX Falcon 1 was the first privately developed liquid fuel rocket to reach orbit. Prior to SpaceX, Elon co-founded PayPal, the world’s leading Internet payment system, and served as the company’s chairman and CEO.

ElON MUSKFounder, Tesla Motors; SpaceX

/ Breaking the Price Barrier

lon Musk is a triple-threat disruptor. as a founder of PayPal,

he took on the banking industry. SpaceX Falcon 1, launched by his Space Exploration Technologies, was the first privately developed liquid fuel rocket to reach earth orbit. and his Tesla Roadster is the world’s first lithium-ion supercar. What does a guy like that worry about at night? The price of gas. It isn’t high enough.

Musk would like to see US pump prices more than triple. That would

help hasten the death of the internal combustion engine and usher in the electric car era. “The economic forcing function that should be at the pump—which should probably be $10 gasoline—isn’t there,” says the Tesla CEO. “You have to try to bridge that gap with innovation. I’m putting so much time and effort into helping create Tesla because I hope we can accelerate that transformation.”

The Tesla Roadster and the new Model S sedan aren’t hybrids—they’re pure

electric cars, running on an array of batteries not so different from those in laptop computers. Musk wanted his cars to disrupt the hybrid market, and as a hands-on executive supervising product development and design, he got his way. he says that detroit’s Big Three automakers have ended up in such a mess in part because they skimped on innovation in engineering. “You really need the product guys running a product company,” argued Musk. “The path to the CEO’s office shouldn’t be through the CFO’s

office, nor should it be the marketing department. It needs to be through engineering and design.”

Even though he sees himself as a competitor, Musk says he wishes detroit no ill will. “”I hope they get very, very focused on making great cars,” he says.” and there’s at least one thing he envies about the Big Three: their acres and acres of factory space. “When the mess gets sorted out,” says Musk, “I’d like to say ‘I’d like some of those plants, if you don’t mind.’”

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“the Path to the ceo’s offIce ... needs to be throUgh

engIneerIng and desIgn.”


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/ ShaI agaSSI is the founder and chief executive of Better Place, a company focused on one of this century’s biggest challenges—building a scalable and sustainable personal transportation system that ends oil dependence. he works directly with government leaders, auto manufacturers, energy companies and others to make his vision of zero-emission electric vehicles powered by renewable energy a reality in countries around the world. This vision was inspired by a profound question posed at the World Economic Forum in 2005, “how do you make the world a better place by 2020?” With a passion for tackling large-scale challenges, agassi sought to answer this question by creating a pragmatic plan to free cars from oil, reduce harmful emissions, and usher in an era of sustainable mobility.

ShaI agaSSIFounder & CEO, Better Place

/ It’s Not about the Car

s CEO of Better Place, Shai agassi has turned the auto industry

business model on its head. Instead of focusing on the vehicle and letting someone else sell the fuel, his company will provide the infrastructure to power a new generation of electric cars. drivers will stop for a charge or a new battery, which will take about the same time as filling up the tank does today. Once there’s a distributed system to reliably

power electric cars, agassi is confident somebody else will step forward make the vehicles. “We’ve done the crazy thing of raising a ton of capital to put the network in place before the product exists,” he says.

The governments of Israel, denmark, and China apparently think agassi is anything but crazy. Better Place has inked deals with all of them to start building the company’s charging

stations and battery swap locations. and, says agassi, as China goes, so goes the world. “Once China does it, you don’t have a choice,” he says.

agassi describes the american auto industry as “a man-made Katrina,” but he also says the survivors will need the infrastructure and support of companies willing to lead the transition to electric vehicles. “You have to enable the six

car makers that will survive this wave,” he says, “because Car 2.0 has to come from them.”

Even if a market for electric cars does develop in China, the global transition from gas to battery power will still take years and massive investments. “We’re not in this game in order to make a quick buck,” agassi says. “Our goal is to end oil, and you can’t do it with a thousand cars. To end oil you’ll need a billion cars.”

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“we’Ve done the crazy thIng of raIsIng a ton of caPItaL to PUt

the networK In PLace before the ProdUct eXIsts.”


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/ VIVEK KUNdRa was appointed as the first Federal CIO of the United States by President Obama in March 2009. In this capacity, he directs the policy and strategic planning of federal information technology investments and is responsible for oversight of federal technology spending. The Federal CIO establishes and oversees enterprise architecture to ensure system interoperability and information sharing and ensure information security and privacy across the federal government. Kundra has been recognized among the top 25 CTOs in the country and as the 2008 IT Executive of the Year for his pioneering work to drive transparency, engage citizens, and lower the cost of government operations. Prior to joining the Obama administration, Kundra served in Mayor Fenty’s cabinet as the CTO for the district of Columbia and governor Kaine’s cabinet as assistant Secretary of Commerce and Technology for the Commonwealth of Virginia. his diverse record also includes technology and public policy experience in private industry and academia.

VIVEK KUNdRaFederal CIO, USa

/ and data for all

pen, transparent and accountable” may seem

antithetical to what americans have come to expect from the federal government, but Vivek Kundra, the new Federal Chief Information Officer, says he can change that. he has plans to improve the way the government works and drive innovation in the public and private sectors by putting government information online where it will be available to anyone with a computer.

The front door for this effort will be data.gov, a site with feeds to all kinds of federal data. data.gov started with

47 feeds three months ago, and now has more 100,000. Eventually it will aggregate information from every agency in Washington.

“data.gov will move us in a direction of participatory democracy by allowing the american people to see how government works and by recognizing that the government does not have a monopoly on the best ideas,” says Kundra. “We will have returned the government to its rightful place, to

‘We the people’ rather just a few folks making all the decisions.”

“The default setting of the United States government should not be that everything be secret and closed,” Kundra says. “The default setting should be open—making sure that we are not releasing information that may be classified, or sensitive.”

More than just a one-way feed, the data.gov dashboard will allow users to manipulate information, create new applications, and tackle problems. For instance, Washington spends more

than $76 billion a year on information technology. Kundra expects that NgOs and private businesses will analyze the data on procurement and deployment costs and create new applications and software that could lead to huge savings. “We’re giving up power and authority, but there’s an economic argument for it, because it allows innovators to tap into the power of the country,” he says.

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the defaULt settIng shoULd be oPen.”


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/ SCOTT ThOMPSON is president of PayPal, with overall responsibility for growing the business and establishing PayPal as the leading global online payment service. Scott previously served as PayPal’s senior vice president and chief technology officer, where he oversaw information technology, product development, and architecture. Prior to PayPal, Scott worked for Inovant, a subsidiary of Visa formed to oversee global technology for the organization. as executive vice president of technology solutions at Inovant, he was responsible for all development, support and maintenance of Visa’s global payment system. Scott was also chief information officer of Barclays global Investors, where he implemented a new strategic technology platform and global infrastructure. In addition, he has worked with Coopers and lybrand, delivering services to clients such as Wells Fargo.

SCOTT ThOMPSONPresident, PayPal

/ The least likely Financial giant

ayPal does one thing really well: It moves money from one

person to another, instantly, with a few keystrokes and the click of a mouse. Which makes the company an especially ingenious kind of disruptor.

“What we do is special,” says PayPal president Scott Thompson. “We’re not aligned with any one brand. We’re

brand agnostic…. It’s hard for other organizations to imagine that they will build something, put it out there, and then let their competitors benefit from having that infrastructure in place. The most frequent question we get is, ‘What are you guys? a bank? an electronic transfer service?’ The answer is that the world hasn’t seen a company like ours before.”

PayPal is ubiquitous on eBay, which purchased the company from its founders in 2002, and the online

auction and sales site is still PayPal’s main opportunity for growth. But Thompson says he is constantly surprised by the novel ways that people all over the world use PayPal, not just for transfers, but to do fairly sophisticated things like run businesses and meet payrolls. Says Thompson: “Make it simple, make it convenient, and people will take you

into their lives in unpredictable ways.”

Thompson thinks a lot about competition from a newer, hungrier company. “I worry about the next group of engineers, [people who] are completely disruptive and totally determined. Could it happen? I wouldn’t bet against it.” Still, he says, “payments is not a business for the faint of heart. Customers have zero tolerance for problems. You have to be good 100 percent of the time.”

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“maKe It sImPLe, maKe It conVenIent, and PeoPLe wILL

taKe yoU Into theIr LIVes In UnPredIctabLe ways.”


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/ JEFF BEzOS has always been interested in anything that can be revolutionized by computers. Intrigued by the amazing growth in use of the Internet, Jeff created a business model that leveraged the Internet’s unique ability to deliver huge amounts of information rapidly and efficiently. In 1994 he founded amazon.com, Inc., now the leading online retailer that offers services which traditional retailers cannot: lower prices, authoritative selection, and a wealth of product information. Before heading west to start amazon.com, Jeff worked at the intersection of computer science and finance, helping build one of the most technically sophisticated quantitative hedge funds on Wall Street for d. E. Shaw & Co. he also led the development of computer systems that helped manage more than $250 billion in assets for Bankers Trust Company.

JEFF BEzOSFounder & CEO, amazon.com

/ having Confidence on the Edge

ifteen years ago Jeff Bezos changed the way we shop online—

now he wants to change the way we read. With the Kindle, the amazon digital e-reader, his goal is to end the era of the printed book. “The book has had a great 500 year run, but it’s time for a change,” he says, adding that a lot of customers agree with him. “We launched [the first] Kindle just over 18 months ago. There are now 300,000 books available. If you look at the universe where we have

both the physical title and the Kindle title, Kindle sales are 35 percent of the physical book sales.”

Bezos discussed the decision to restrict the new Kindle dX to the same basic tasks as the original: delivering books and other text-heavy material. There’s no camera, no keyboard—why not? “Reading is an important enough activity that it deserves a purpose-built device,” said Bezos. “It’s a myth that multi-purpose devices are always better.”

he sees electronic books as a net gain for traditional publishers, even if they don’t realize it yet. “If you look at the efficiencies by not having to do all that printing and the incremental gains on selling more copies, authors are going to be read more. They’re going to make more money. Return on invested capital is going to be higher, capital expenditures are going to be lower.” as for the publishers’ seeming inability to deal with the advent of the e-book,

“If you’re an incumbent and things are changing, it’s very anxiety producing.”

Bezos says the Kindle is a tool that makes reading easier. Which means people will read more, and buy more books. “Now you can think of a book and have it 60 seconds later. That will drive sales.”

Who is the biggest fan of the Kindle? It may be Bezos. “I get grumpy now when I’m forced to read a physical book,” he says.

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“It’s a myth that mULtI-PUrPose deVIces

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/ JEFF IMMElT is the ninth chairman of gE, a post he has held since September 7, 2001. Immelt has held several global leadership positions since coming to gE in 1982, including roles in gE’s Plastics, appliance, and Medical businesses. In 1989, he became an officer of gE and joined the gE Capital Board in 1997. In 2000, Immelt was appointed president and chief executive officer. Immelt has been named one of the “World’s Best CEOs” three times by Barron’s, and since he began serving as chief executive officer, gE has been named “america’s Most admired Company” in a poll conducted by Fortune magazine and one of “The World’s Most Respected Companies” in polls by Barron’s and the Financial Times. Immelt is also a member of The Business Council, and he is on the board of the New York Federal Reserve.

JEFF IMMElTChairman & CEO, gE

/ disrupt Before You’re disrupted

eff Immelt is proof that you don’t have to be a small, scrappy inno-

vator to create massive change. during the past decade Immelt has led creative disruption within gE, first on the environment, and now in health care.

during the Bush administration, Immelt decided to embark aggressively on green initiatives—even though it meant taking an axe to a prime source of revenue. “It’s obvious that this is now the right choice, but it

was not part of the political climate,” he says. By focusing on a program called ecoimagination, Immelt and gE reduced the company’s costs by more than $100 million.

But the changes meant killing gE’s incandescent light bulb business in favor of compact fluorescent bulbs. “In your gut, you know 100-year-old technologies might not last forever,” he says. “One of the reasons it’s so hard to innovate or be disruptive is that you run the risk of giving something up.” You have to be willing to attack your installed base.

Now Immelt and gE are applying this same thinking to health care. One example: a new magnetic resonance device that sells for a fraction of the cost of the company’s current MRI machines. gE can introduce new products at lower prices in the United States and the U.S. “business will be just fine,” he says. “and we unleash incredible opportunities in Russia, China, India, Saudi arabia, africa… This is what’s going to power our healthcare business over the next decade.”

Immelt also says that the United States needs to reinvent itself as a manufacturing nation, to disrupt its own service economy. “We are at an all-time low in research spending. Nothing happens unless we rejuvenate technology. We’ve got to like manufacturing. To be a service-oriented importer is just wrong.”

“let’s get on with the process of innovation,” says Immelt. “The rest of the world moves without us. People aren’t going to wait for us.”

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“one of the reasons It’s so hard to InnoVate

or be dIsrUPtIVe Is that yoU rUn the rIsK of

gIVIng somethIng UP.”


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/ TOBY SEgaRaN is the co-founder of Freerisk and the author of Programming Collective Intelligence, amazon’s top-selling aI book. his upcoming titles Programming the Semantic Web and Beautiful Data will be released in July. he speaks on the subjects of machine learning, collective intelligence and freedom of data at conferences worldwide. he currently holds the title of data Magnate at Metaweb Technologies, where he works on large-scale data reconciliation problems. Prior to Metaweb he founded Incellico, a biotechnology software company acquired in 2003. he holds a B.Sc. in Computer Science from MIT and USCIS deemed him a “Person of Exceptional ability.”

/ JESPER aNdERSEN is the co-founder of Freerisk and is a statistician, computer scientist and entrepreneur. he is currently a consultant with the Open data group, focusing on machine learning, risk assessment and artificial intelligence sys-tems. he’s spoken on finance and statistical sys-tems, and is the founder of Certainty labs, a start-up focusing on making complex statistical modeling simpler. Previously he was the lead architect at Visible Path, which was sold in 2008. Jesper holds a B.Sc. in Physics from haverford College and an M.B.a. from University of Chicago’s Booth School of Business, where he received the Vijay Vashee Most Promising Entrepreneur award in 2008.

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JESPER aNdERSEN& TOBY SEgaRaNCo-Founders, Freerisk

/ Who Needs Moody’s?

ometimes disruption means picking up the pieces of a ravaged

operation and rebuilding it in a more useful, more robust way. That’s what freerisk.org is trying to do with the debt-rating ratings system that helped cause the global credit crisis.

let’s look at an example: how did insurance giant aIg hold onto its aaa

credit rating almost to the moment that the federal government stepped in to save the company with a billion dollar bailout? Jesper andersen and Toby Segaran, partners in freerisk, say the answer is easy. The big agencies, Moody’s, S&P, and Fitch, rated complicated derivatives not on quality and transparency, but in order to please the customers who created

those products. The result: top ratings for risky products. “These days it really shouldn’t take too much to think through why we might want to revisit how we evaluate our debt,” says andersen.

Segaran and andersen are designing a transparent, crowd-sourced platform that anyone can use to modify, rank and

sort financial data about a company. Users can also collaborate to develop and test algorithms that turn that data into useful ratings.

“This is primarily a story about open data,” says andersen. “We want to completely change the way we think about corporate credit ratings. We want to decentralize risk measurement.”


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“we want to comPLeteLy change the way we thInK aboUt

corPorate credIt ratIngs. we want to decentraLIze

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/ NEIl YOUNg is the founder and CEO of ngmoco, creator and publisher of games exclusively for iPhone and iPod touch. Prior to founding ngmoco, Neil held various positions at Electronic arts, most recently as the group general Manager of the Ea Blueprint Studio group that included Maxis (creators of Spore™ and The Sims™) and Ea’s collaborative partnership with Steven Spielberg. Neil joined Ea in 1997 as general Manager of Ea’s Origin Systems subsidiary, where he supervised the launch of the world’s first massively multiplayer online role-playing game, Ultima Online™. Prior to Ea Blueprint, Neil served as Vice President and general Manager of Ea los angeles and Ea Maxis, where he oversaw the studios responsible for the blockbuster franchises Medal of honor™, Command & Conquer™, The lord of the Rings™ and The Sims.

NEIl YOUNgFounder & CEO, ngmoco

/ The game has Just Changed

s CEO of mobile games publisher ngmoco—that’s pronounced

N-g-moko—Neil Young believes in the disruptive force of the iPhone. But even coming from a gaming background with Ea, Young says he was caught off guard by the rapid changes that smart phones created in the mobile games industry. “If somebody had told me two years ago that I was going to be the CEO of a mobile phone game company, I would’ve said ‘What the fuck happened?!’ did I get fired?”

Now that ngmoco has a clutch of games sitting comfortably in the iTunes app Store Top 25, Young is no longer stunned. But he still marvels at how quickly the iPhone transformed his business and his own phone habits. It’s a reminder that disruption can come from any direction, at any time.

Young says he found himself spending less time on his computer and more

time on the iPhone. “I noticed that I wasn’t just using it to make telephone calls. “ he says. like millions of iPhone owners, Young also started to spend time trawling the app Store. Many of the new applications are so good, and so inexpensive, “users are starting to buy software like songs,” says Young. Plus, iPhone customers always have their handsets with them. “We observed that entertainment and interactivity was not moving closer to the desktop, it was moving closer to the person.”

Ultimately, the iPhone presents ngmoco with a huge chance to disrupt. It’s a widely supported, web-enabled, developer-friendly weapon in the mobile battle against devices like Nintendo’s dS and Sony’s PSP. “The opportunity for us was not just to beat the mobile games business,” says Young, “but to take the old handheld business and crush it—to destroy it off the back of the iPhone.”

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/ ReCaP: a Day OF DIsRUPTIve DIsCUssION

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CLOCKWISE FROM TOP LEFT 1 / ge Chairman & CeO Jeff Immelt, 2 / WIReD senior editor Nicholas Thompson with Federal CIO vivek kundra, 3 / WIReD Contributing editor spencer Reiss with Founder of Ubuntu Project Mark shuttleworth and OpenX CeO Tim Cadogan, 4 / editor in Chief of WIReD Chris anderson with Founder of Tesla Motors and spaceX elon Musk 5 / WIReD senior Writer Daniel Roth with Founder & CeO of better Place shai agassi, 6 / WIReD senior Writer steven levy with Founder & CeO of amazon.com Jeff bezos

“terrIfIc LIne UP of sPeaKers, and the aUdIence was jUstas ImPressIVe. aLLtoLd, a fascInatIng day. If yoU eVer getan InVIte to any eVent they host, It Is a mUst attend.they PUt on qUIte the show.”

– author, Trader & CNbC analyst barry Ritholtz, The big Picture, June 15, 2009

/ a Day OF DIsRUPTIve DIsCUssION

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The country and companies like his have “outsourced too many things,” said Mr. Immelt at a WIReD magazine conference about disruptive technology in New york on Monday, where he was interviewed on stage by WIReD editor In Chief Chris anderson.

In the future, amazon.com’s kindle e-book reader will display more book formats beyond its own. and you should expect to see kindle books on a lot more devices. That was the clear implication of comments that Jeff bezos, amazon’s chief executive, made at the conference, which was sponsored by WIReD magazine.

CNN aired footage from the WIReD business Conference of WIReD senior editor Nick Thompson discussing transparency in the Obama administration with Federal CIO vivek kundra.

“I’m anti-tax, but I’m pro-carbon tax,” Tesla Motors founder elon Musk said onstage at the WIReD business Conference here Monday—a remark that prompted interviewer and WIReD editor in Chief Chris anderson to quip that he was a “true silicon valley libertarian.”

350 C-level executives and business leaders

MARTHA STEWART, Founder, MslO

BEN FRIED, CIO, google

NICHOLAS NEGROPONTE, Chairman, One laptop per Child

MICHAEL MENDENHALL, CMO & svP, hewlett Packard

JEFF HAYZLETT, CMO, kodak

GRAZIANO DE BONI, President & CeO, Prada Usa

CHRIS BEARD, CIO, Mozilla

JONATHAN MARCHBANK, COO, virgin Mobile Usa

@WIREDBiz #WIREDLive381 followers as of June 15, 2009

MarthaStewart “at the WIReD business Conference listening to “lions” of new technology disruptive by design. Jeff bezos, Jeff Immelt, Mark shuttleworth, etc.” Tim O’Reilly “Immelt: Tim O’Reilly vivek kundra at WIReD Disruptive by Design Conference: govt agencies now competing to be top data.gov contributor! #wiredlive #gov20”

Jeffrey Hayzlett “Told Martha stewart at break she should have brought cookies. she told me to bring cameras! ;) #wiredlive” jkrohrs effective display of Panasonic Toughbooks at #wiredlive. Two of them under a melting ice sculpture. http://pk.gd/bQd

shelly_palmer listening to vivek kundra, 1st CIO of the Usa discuss data.gov at the WIReD biz Conf #wiredlive, the CeO of the Usa has chosen well.

/ PRESS HIGHLIGHTS

/ ATTENDEES

/ OTHER PRESS INCLUDES

/ WaTCh COMPleTe vIDeOs OF all WIReD bUsINess CONFeReNCe PaNels aT:

wired.com/wiredbizprogram

/ THE TALK ON

/ TOP DIsRUPTORs gRab The sPOTlIghT A-LIST ATTENDEES

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Press ImPressIons: 40 million+*

*Press IMPressIons as of 6/24/09

http://online.wsj.com/article/SB124518791256120299.html

http://bits.blogs.nytimes.com/2009/06/15/jeff-bezos-kindle-books-and-readers-are-separate-businesses/

http://www.cbsnews.com/stories/2009/06/15/tech/cnettechnews/main5090301.shtml

http://www.techcrunch.com/2009/06/15/chris-andersons-counterintuitive-rules-for-charging-for-media-online/

http://www.fastcompany.com/blog/clay-dillow/culture-buffet/amazon-will-format-e-books-other-readers-could-open-kindle-outside-t

http://www.ft.com/cms/s/0/14a4db92-5ad5-11de-8c14-00144feabdc0.html

http://business.theatlantic.com/2009/06/wireds_business_disruptive_by_design_liveblogging_profiting_without_revenue.php

http://www.forbes.com/fdc/welcome_mjx.shtml

http://twitter.com/wiredbiz#wiredlive

http://www.wired.com/wiredbizprogram

http://www.cnn.com

http://www.wired.com/wiredbizprogram

BUSINESS CONFERENCE

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CLOCKWISE FROM TOP LEFT 1 / vivek kundra, Federal CIO of Usa meets Nicholas Negroponte, Chairman of One laptop per Child, 2 / author Richard bookstaber was among our distinguished group of attendees, 3 / The atrium of the Morgan served as a networking hub throughout the Conference, 4 / Chris anderson, editor in Chief of WIReD and barry Ritholtz, CeO of FusionIQ

4 /

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BUSINESS CONFERENCE

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sPONsORs /

Presented In PartnershIP wIth

/ We saLUTe The InforMeD, oPTIMIsTIC, anD InnoVaTIVe sPonsors of The WIreD bUsIness ConferenCe: DIsrUPTIVe bY DesIGn.

BUSINESS CONFERENCE

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We’re ally, an online bank focused on doing right by you and

your money. We offer rates among the most competitive in

the country, we never hide behind fine print, and we give you

24/7 access to a real human being. Isn’t it time for some

straightforward banking?

For more information, please visit allybank.com

http://www.allybank.com

BUSINESS CONFERENCE

20 /


american airlines is one of the largest airlines in the world,

contributing more than $150 billion per year to the U.S.

economy. american and its regional airline affiliates, american

Eagle and americanConnection, serve 250 cities in over

40 countries with more than 3,400 daily flights. The network

covers points throughout North america, the Caribbean, latin

america, Europe and the Pacific with major connecting hubs

at dallas/Fort Worth, Chicago O’hare, Miami, and St. louis,

and a large concentration of Caribbean service at San Juan,

Puerto Rico. american also has a large presence in other large

U.S. metropolitan areas, including New York (four airports),

los angeles (four airports) and Boston. The combined fleet

numbers more than 900 aircraft. american has nearly 82,000

employees worldwide and american Eagle 13,000.

american airlines is also a founding member of the global

oneworld® alliance, which enables member airlines to offer

its customers a broader route network, opportunities to earn

and redeem frequent flyer miles across the combined network

and more airport lounges. Together, oneworld members serve

nearly 700 destinations in over 150 countries, with 8,500

daily departures. american is also one of the largest scheduled

air freight carriers in the world, providing a wide range of

freight and mail services to shippers throughout its system

onboard american’s passenger fleet.

For more information, please visit aa.com

http://www.aa.com

PUBLICATION: DO NOT PRINT DOTTED LINE OR BELOW

Agency Approvals: INITIALS DATE

Proofreader _______ _______

Copywriter _______ _______

Art Director _______ _______

Creative Director _______ _______

Account Exec. _______ _______

Supervisors: INITIALS DATE

Acct. Sup. _______ _______

Mgmt. Sup. _______ _______

Prod. Mgr. _______ _______

Client Approval: INITIALS DATE

_______ _______

Duped from M9172-4 by: byn

Path: Production3:AmericanAirlines:Jobs:MJobs:M9100Jobs: Proof #1Trim: 7"w x 9.75"h Bleed: 7.25"w x 10"h Live: 6.25"w x 9"hPage 1 of 1 Date: 5/4/09 Inks: 4/C Revised by: cg CPS CheckOut: _________

JOB #: M9172TITLE: 2009 BUSINESS – BALCONYPRINT PRODUCER: NORITA JONESPROJECT/TRAFFIC MGR.: LEWIS/RODGESART DIRECTOR: BILL OAKLEYSHIP: 5/4/09PUBLICATION & INSERTION DATE:Wired DBM Conference Program

Service totals include American Eagle.® AmericanAirlines, American Eagle, AA.com and We know why you fly are marks of American Airlines, Inc. oneworld is a mark of the oneworld Alliance, LLC.

EYECONTACT.YOURMOSTUNDERRATEDSKILLSET.

Sometimes,

the more business

you do face-to-face, the

more business actually gets done.

3,400 flights. 250 cities. 40 countries. One airline.

M9172-7_Wired.indd 1 5/4/09 5:37:21 PM

BUSINESS CONFERENCE

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Risk Management for an online world.

dataPipe provides custom solutions for businesses with com-

plex Internet-facing infrastructures. We proactively manage

security, monitoring, storage, data center operations, servers,

and applications including database administration and the

full software stack.

For more information, please visit datapipe.com

http://www.datapipe.com

BUSINESS CONFERENCE

24 /


Fujitsu Computer Products of america, Inc. is an established

leader in the document imaging market, featuring state-of-

the-art scanning solutions. Organizations of all sizes can

benefit from the various document-imaging solutions available

in the award-winning Fujitsu scanner product line. delivering

an unbeatable combination of affordability, reliability and

performance, Fujitsu scanners range in speeds from 8-120

pages per minute (ppm).

at the touch of a button, the Fujitsu ScanSnap scanner turns

paper documents into instant PdFs. The ScanSnap provides

convenience, simple connectivity, automatic color, page

size and blank-page detection. The ScanSnap features an

automatic document feeder (adF) that digitizes both sides

of a document in a single pass in color, making it ideal for an

office or home office environment.

For more information, please visit us.fujitsu.com/scansnap

or call 1.888.425.8228

http://cheetah.fcpa.fujitsu.com/right_now/

09fip160_WiredConfGuide_ol.indd 1 5/7/09 4:49:24 PM

BUSINESS CONFERENCE

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NYSE Technologies is the world’s leading provider of end-to-end

electronic trading solutions. Our flexible and scalable products

and services deliver robust and integrated solutions, from

single trading positions to complete exchange platforms.

Through our innovative market-leading software, market data and

low-latency secure connectivity, we engage the global trading

community with innovative tools, access to liquidity and worldwide

markets and third-party, value-added applications.

We empower all tiers of the market by offering our solutions

as fully deployed, managed or hosted services.

From a single company, we deliver best-of-breed products

using world-class technology connected to all the world’s

major markets.

For more information, please visit nyse.com/technologies

http://www.nyse.com/technologies/1207087035761.html

BUSINESS CONFERENCE

27 /


For over 15 years Panasonic Computer Solutions Company

has designed and manufactured the industry’s most durable

and reliable mobile PCs. legendary Panasonic Toughbook®

computers are the ultimate rugged and wireless total

computing solution, giving mobile users constant productivity

without risking important data. Engineered with a magnesium

alloy case, shock-mounted hard drive and spill-resistant

design, our computers allow professionals across a multitude

of industries to trump conventional business practices and

work wherever their job takes them. No matter how extreme

the demands of your job, award-winning Toughbook computers

are built to withstand the harshest conditions, ensuring

maximum uptime in the field, on the road or in the boardroom. In

a world where you’re only as tough as the tools you carry, it’s nice

to know Toughbook computers can handle virtually anything.

For more information on our full line of rugged, reliable

and wireless computers, please call 1.888.223.1184 or

visit panasonic.com/toughbook

http://www.panasonic.com/business/toughbook/laptop-computers.asp

IN YOUR WORLD,YOUR COMPUTER SHOULD BE YOUR FORTRESS.IF IT’S NOT, EXPERIENCE LEGENDARY TOUGHBOOK RELIABILITY. When it comes to rugged and reliable performance, Panasonic Toughbook® computers deliver. Every Toughbook computer is a triumph of engineering – from the ground up and inside out. With their durable magnesium alloy cases, spill-resistant keyboards and shock-mounted hard drives, Toughbook computers perform no matter how extreme the demands of your job. Add to that dependable wireless built-in and you have a computer that’s ready and waiting. It’s no surprise that Toughbook computers, powered by Intel® Centrino® 2 with vPro™ technology, continue Panasonic’s 15-year-plus tradition as the leader in rugged mobile computing.

1.888.223.1184 / panasonic.com/toughbook

Panasonic recommends Windows Vista® Business.

Intel, the Intel logo, Centrino, Centrino Inside, Intel vPro and vPro Inside are trademarks of Intel Corporation in the U.S. and other countries. Toughbook notebook PCs are covered by a 3-year limited warranty, parts and labor. To view the full text of the warranty, log on to panasonic.com/business/ toughbook/support.asp. Please consult your Panasonic representative prior to purchase. Panasonic is constantly enhancing product specifications and accessories. Specifications subject to change without notice. (*CF-52EV, CF-52GF and CF-52GU, **CF-30K, ***CF-F8EW) ©2009 Panasonic Corporation of North America. All rights reserved. Fortress_H_Bizco_FY09-1

TOUGHBOOK

FOR A TOUGHWORLDTM

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Toughbook 52* Toughbook 30** Toughbook H1 Toughbook F8*** Toughbook U1

PAN1677-2_Fortress_Wired Ad.indd 1 5/21/09 4:16:45 PM

WE LIVE IN AN ERA OF RELENTLESS CHANGE.For insights that will help you and your company adapt, respond, and thrive—no matter what comes at you next, visit:

wired.com/wiredbizprogram

NOW ONLINE

Thank you for joining us at the WIReD bUsINess CONFeReNCe

DISRUPTIVE by DesIgN

Tell us what makes you feel INFORMeD & OPTIMIsTIC send your thoughts to [email protected]

http://www.wired.com/wiredbizprogram/